The ISM Services Index registered 55.2%, 6.0 percentage points higher than December’s seasonally adjusted reading of 49.2%. The composite index grew in January after contracting in December for the first time since May 2020, when it registered 45.4%.
“Ten industries reported growth in January, according to the Services PMI®, which was in expansion territory after a single month of contraction and the prior 30-month period of growth. The composite index has indicated expansion for all but three of the previous 155 months,” said Anthony Nieves, Chair of the Institute for Supply Management (ISM).
The Business Activity Index registered 60.4%, a 6.9 percentage point increase compared to the seasonally adjusted reading of 53.5% in December.
Employment Index registered 50%, up 0.6 percentage point from the seasonally adjusted December reading of 49.4%. Eight out of fifteen industries reported growth in employment for the month.
New Orders Index registered 60.4%, up 15.2 percentage points from the seasonally adjusted December reading of 45.2%. New orders grew after contracting in December for the first time after 30 consecutive months of growth. Comments from respondents include: “Increased production due to new customers” and “January is typically higher for us than December, as it’s the start of a new year versus a holiday month.”
Supplier Deliveries Index registered 50%, up 1.5 percentage points from the 48.5% recorded in December. A reading above 50% indicates slower deliveries, while a reading below 50 percent indicates faster deliveries. This month’s reading indicated supplier deliveries is unchanged from December. Comments from respondents include: “Post-holiday freight has proven to be more efficient” and “Shortened lead times and increased fill rates.”